SECP proposes significant amendments to AML/CFT Regulations, 2020
There have been significant amendments proposed to the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Regulations, 2020 by the Securities and Exchange Commission of Pakistan (SECP).
In addition to strengthening the country’s financial integrity framework, these amendments aim to enhance the scope of regulations for combating proliferation financing. In the next 14 days, SECP has invited stakeholders to provide comments and/or suggestions on proposed amendments. Proliferation financing, which is the provision of financial support to enable the proliferation of weapons of mass destruction (WMD) or their delivery systems, has become a significant global problem. As a result of SECP’s proactive approach to strengthening the regulations that address AML/CFT, a comprehensive approach is needed to address this issue.
The proposed amendments to the AML/CFT Regulations 2020 focus primarily on expanding the regulatory framework to encompass measures specifically tailored for combating proliferation financing and reducing the frequency of treating an account as dormant from the existing five years to three years. SECP also adds provisions related to reliance on third parties for CDD and requirements applicable to foreign branches and subsidiaries of Regulated Persons in order to enhance the effectiveness of the regulations. Public consultation is an essential component of SECP’s commitment to transparency and inclusion. Developing robust regulations that are aligned with the evolving needs of the financial ecosystem requires the involvement of stakeholders. A dedicated online portal has been established for stakeholders to provide feedback within a 14-day period. SECP’s website contains the proposed amendments.